Scary economy, real solutions

Solution: Be prepared, shop around

Today, lenders are requiring much higher down payments, better financial documentation and higher credit scores than they did during the boom, cutting back on the number of potential buyers. Now is the time to get the best credit score that you can - investigate markets you're interested in and start squirreling away your down payment.

For now, credit scores matter the most, and the higher your score is, the lower your rate and fees will be.

But larger than normal down payments - 25% to 30% of the value of the property, for example - can also lower your interest rate by convincing the bank that you won't walk away at the first sign of an economic chill.

The bad news is that even if you have a high credit score, tailored mortgage pricing could make getting a home loan more time consuming. With lenders considering factors they never did before, the result is going to be a much wider variety in the rates you are offered by different brokers and banks.

The moral: In the future you will want to invest more time shopping for a mortgage than the average person does today. The payoff for doing so is going to get a lot larger. --Les Christie, Gerri Willis and Stephen Gandel

NEXT: Sinking home prices